Monster Worldwide Reports Second Quarter 2013 Results
Second Quarter Results
- Revenue from Continuing Operations of $200 million
- GAAP EPS from Continuing Operations of $0.04
- Non-GAAP EPS from Continuing Operations of $0.09
- Non-GAAP Operating Expenses declined by 11% year over year
- Careers - North America Non-GAAP EBITDA margin of 28%
- Cash Flows Generated from Operations of $15.4 million, which included approximately $10 million of restructuring payments
- Repurchased 4.4 Million Shares of Common Stock
- Corporate Restructuring Efforts to Improve Profitability Substantially Completed
"We are aggressively pursuing the execution of our business strategy and are also developing a number of new strategies to better position the Company for sustained, long term revenue growth in the evolving job market. Over 200 million people have registered on the Monster Worldwide network and we continue to drive quality job applies to our customers," said Sal Iannuzzi, chairman, president and chief executive officer of Monster Worldwide. "While the global economy has continued to put pressure on our business, with Europe being our weakest region, we were encouraged to see some stabilizing trends in each of our major markets during the quarter. Our second quarter results demonstrate our ability to control costs and protect profitability, even in a challenging market environment. And consistent with our objective to enhance shareholder returns, we successfully repurchased $23 million worth of our shares."
Second Quarter 2013 Results
Revenue from continuing operations was $200 million, compared to second quarter 2012 revenue of $225 million. Historical data on revenue from continuing operations for prior quarters is available in the Company's supplemental financial information.
Consolidated GAAP operating expenses from continuing operations of $192 million compares to $210 million in the second quarter 2012. Net income from continuing operations for the second quarter was $4.1 million, or $0.04 per share, which included $5.4 million of non-recurring charges, compared to $9.0 million, or $0.08 per share in the second quarter 2012, which included $1.9 million of non-recurring charges.
Non-GAAP net income from continuing operations was $9.6 million or $0.09 per share, compared to $10.9 million, or $0.10 per share in the second quarter 2012. Non-GAAP operating expenses of $183.6 million decreased 11% year over year. Non-GAAP EBITDA margin of 19%, led by Careers-North America with a 28% Non-GAAP EBITDA margin, increased from 18% in the second quarter of 2012. Pro-forma items are described in the "Notes Regarding the Use of Non-GAAP Financial Measures" and are reconciled to the GAAP measure in the accompanying tables.
Net cash provided by operating activities in the quarter was $15.4 million and is net of approximately $10 million cash costs associated with the Company's restructuring efforts. Deferred revenue was $329 million compared to $352 million as of December 31, 2012. The Company ended the quarter with total available liquidity of $258 million.
During the second quarter 2013, Monster repurchased 4.4 million shares of its common stock at an average cost of $5.35 per share, for a total of $23 million.
The Company's corporate restructuring initiatives were substantially completed in the second quarter and the desired savings have been achieved.
Six Months Results
Monster Worldwide reported total revenue of $412 million for the first six months ended June 30, 2013 compared to $458 million in the same period last year, a 10% decrease. Monster Careers revenue decreased 10% to $375 million compared with $419 million in the 2012 period. Internet Advertising & Fees reported revenue of $37 million compared to $39 million in the prior year period. The Company reported earnings from continuing operations of $15.3 million, or $0.14 per share, compared to $22.4 million, or $0.19 per share, in the prior period.
Company Provides Q3 EPS Guidance
Third quarter 2013 EPS from continuing operations is expected to be in the range of $0.06 to $0.10.
Conference Call and Webcast
Second quarter 2013 results will be discussed on Monster Worldwide's quarterly conference call on August 1, 2013 at 8:30 AM ET. A live webcast of the conference call can be accessed online through the Investor Relations section of the Company's website at http://ir.monster.com. To join the conference call by telephone, please dial (888) 696-1396 or (706) 758-9636 and reference conference ID# 97827231.
A presentation of financial slides will be referenced during the conference call and will be viewable through the live webcast. A PDF of the financial presentation can also be accessed directly through the Company's Investor Relations website at http://ir.monster.com.
The Company has also made available certain supplemental financial information which can be accessed directly through the Company's Investor Relations website at http://ir.monster.com.
For a replay of the conference call, please dial (855) 859-2056 or (404) 537-3406 and reference ID# 97827231. This number is valid until midnight on August 15, 2013.
About Monster Worldwide
Monster Worldwide, Inc. (NYS: MWW) , is the global leader in successfully connecting job opportunities and people. Monster uses the world's most advanced technology to help people Find Better, matching job seekers to opportunities via digital, social and mobile solutions including monster.com®, our flagship website, and employers to the best talent using a vast array of products and services. As an Internet pioneer, more than 200 million people have registered on the Monster Worldwide network. Today, with operations in more than 40 countries, Monster provides the broadest, most sophisticated job seeking, career management, recruitment and talent management capabilities globally. For more information visit about.monster.com.
Special Note: The statements in this release that are not strictly historical, including, without limitation, statements regarding the Company's strategic direction, prospects and future results, constitute forward-looking statements within the meaning of Section 27A of the Securities Act of 1933 and Section 21E of the Securities Exchange Act of 1934. Such forward-looking statements involve certain risks and uncertainties and, therefore, actual results may differ materially from what is expressed or implied herein and no assurance can be given that the Company will achieve, among other things, its outlook with respect to earnings per share for the third quarter 2013. Factors that could cause results to differ materially from those expressed or implied by such forward-looking statements include, but are not limited to, economic and other conditions in the markets in which we operate, risks associated with acquisitions or dispositions, competition, and the other risks discussed in our Form 10-K and our other filings made with the Securities and Exchange Commission, which discussions are incorporated into this release by reference. Many of the factors that will determine the Company's future results are beyond the ability of management to control or predict. Readers should not place undue reliance on the forward-looking statements in this release as they reflect management's views only as of the date hereof. The Company undertakes no obligation to revise or update any of the forward-looking statements contained in this release or to make any other forward-looking statements, whether as a result of new information, future events or otherwise.
Notes Regarding the Use of Non-GAAP Financial Measures
The Company has provided certain non-GAAP financial information as additional information for its operating results. These measures are not in accordance with, or an alternative for, generally accepted accounting principles ("GAAP") and may be different from non-GAAP measures reported by other companies. The Company believes that its presentation of non-GAAP measures provides useful information to management and investors regarding certain financial and business trends relating to its financial condition and results of operations.
Non-GAAP revenue, operating expenses, operating income from continuing operations, operating margin, net income from continuing operations, net (loss) income from discontinued operations, and diluted earnings (loss) per share all exclude certain pro-forma adjustments including: costs incurred for the 2012 restructurings; recovery of restitution award from former executive; costs incurred related to the Company's review of strategic alternatives; income tax benefits associated with the reversal of income tax reserves on uncertain tax positions and a tax benefit related to certain losses arising from the Company's restructuring program; and the results of the businesses in Careers - China, Latin America and Turkey as they have been classified as discontinued operations. The Company uses these non-GAAP measures for reviewing the ongoing results of the Company's core business operations and in certain instances, for measuring performance under certain of the Company's incentive compensation plans. These non-GAAP measures may not be comparable to similarly titled measures reported by other companies.
Earnings before interest, taxes, depreciation and amortization ("EBITDA") is defined as net income or loss before interest income or expense, income tax expense or benefit, net gain or loss in equity interests, depreciation and amortization, non-cash compensation expense and non-cash restructuring costs. The Company considers EBITDA to be an important indicator of its operational strength which the Company believes is useful to management and investors in evaluating its operating performance. EBITDA is a non-GAAP measure and may not be comparable to similarly titled measures reported by other companies.
Operating income before depreciation and amortization ("OIBDA") is defined as net income or loss from operations before depreciation, amortization of intangible assets, amortization of stock-based compensation and non-cash costs incurred in connection with the Company's restructuring program. The Company considers OIBDA to be an important indicator of its operational strength. This measure eliminates the effects of depreciation, amortization of intangible assets, amortization of stock-based compensation and non-cash restructuring costs from period to period, which the Company believes is useful to management and investors in evaluating its operating performance. OIBDA is a non-GAAP measure and may not be comparable to similarly titled measures reported by other companies.
Free cash flow is defined as cash flow from operating activities less capital expenditures. Free cash flow is considered a liquidity measure and provides useful information about the Company's ability to generate cash after investments in property and equipment. Free cash flow reflected herein is a non-GAAP measure and may not be comparable to similarly titled measures reported by other companies. Free cash flow does not reflect the total change in the Company's cash position for the period and should not be considered a substitute for such a measure.
Net cash and securities are defined as cash and cash equivalents plus short-term marketable securities, less total debt. Total available liquidity is defined as cash and cash equivalents, plus short-term marketable securities plus unused borrowings under our credit facilities. The Company considers net cash and securities and total available liquidity to be important measures of liquidity and indicators of its ability to meet its ongoing obligations. The Company also uses net cash and securities and total available liquidity, among other measures, in evaluating its choices for capital deployment. Net cash and securities and total available liquidity are presented herein as non-GAAP measures and may not be comparable to similarly titled measures used by other companies.
|MONSTER WORLDWIDE, INC.|
|UNAUDITED CONSOLIDATED STATEMENTS OF OPERATIONS|
|(in thousands, except per share amounts)|
|Three Months Ended June 30,||Six Months Ended June 30,|
|Salaries and related||89,467||99,812||187,042||212,124|
|Office and general||52,262||57,945||103,394||110,453|
|Marketing and promotion||43,394||51,426||92,661||100,724|
|Restructuring and other special charges||6,828||1,015||19,995||25,283|
|Recovery of restitution award from former executive||-||-||-||(5,350||)|
|Total operating expenses||191,951||210,198||403,092||443,234|
|Interest and other, net||(1,357||)||(1,189||)||(2,625||)||(2,652||)|
|Income before income taxes and loss in equity interests||6,750||13,190||6,327||12,441|
|Provision for (benefit from) income taxes||2,366||3,930||(9,633||)||(10,374||)|
|Loss in equity interests, net||(245||)||(255||)||(703||)||(455||)|
|Income from continuing operations||4,139||9,005||15,257||22,360|
|Loss from discontinued operations, net of tax||(759||)||(4,203||)||(6,893||)||(13,816||)|
|*Basic earnings per share:|
|Income from continuing operations||$||0.04||$||0.08||$||0.14||$||0.20|
|Loss from discontinued operations, net of tax||(0.01||)||(0.04||)||(0.06||)||(0.12||)|
|Basic earnings per share||$||0.03||$||0.04||$||0.08||$||0.07|
|*Diluted earnings per share:|
|Income from continuing operations||$||0.04||$||0.08||$||0.14||$||0.19|
|Loss from discontinued operations, net of tax||(0.01||)||(0.04||)||(0.06||)||(0.12||)|
|Diluted earnings per share||$||0.03||$||0.04||$||0.07||$||0.07|
|Weighted average shares outstanding:|
|Operating income before depreciation, amortization, and non-cash restructuring:|
|Depreciation and amortization of intangibles||15,725||15,952||31,829||31,817|
|Amortization of stock-based compensation||5,470||7,254||12,264||15,506|
|Restructuring non-cash expenses||4,540||34||5,315||6,417|
|Operating income before depreciation, amortization, and non-cash restructuring||$||33,842||$||37,619||$||58,360||$||68,833|
|*Earnings per share may not add in certain periods due to rounding.|